Political Means versus Economic Means

March 30 marks the anniversary of the birth of someone who introduced a crucial distinction in understanding political reality – sociologist Franz Oppenheimer. In The State, he contrasted the “political means” and the “economic means.”

There are two fundamentally opposed means whereby man…is impelled to obtain the necessary means for satisfying his desires. These are work and robbery, one’s own labor and the forcible appropriation of the labor of others…I propose…to call one’s own labor and the equivalent exchange of one’s own labor for the labor of others, the “economic means”…while the unrequited appropriation of the labor of others will be called the “political means.”

Oppenheimer directed his distinction toward developing the conquest theory of the state.

All world history…presents…a contest…between the economic and the political means…The state is an organization of the political means…forced by a victorious group of men on a defeated group, with the sole purpose of regulating the dominion of the victorious group over the vanquished.

Oppenheimer drew some very important conclusions about the relationship between the nature of society and the nature of the State

Always, in its essence, is the “State” the same. Its purpose…the political means… Its form…dominion.

Wherever opportunity offers, and man possesses the power, he prefers political to economic means.

By the “State,” I do not mean the human aggregation…as it properly should be. I mean…that summation of privileges and dominating positions which are brought in to being by extra economic power…I mean by Society…all purely natural relations and institutions between man and man…

The “state” is the fully developed political means, society the fully developed economic means…in the “freemen’s citizenship,” there will be no “state” but only “society.”

The “state” of the future will be “society” guided by self-government.

Franz Oppenheimer’s insights were particularly influential on Albert Jay Nock. Particularly in Our Enemy the State, Nock expanded on them, arguing that the State (in contrast with the voluntary arrangements people make to live together, which he called government) was based on theft, so that “the State is fundamentally anti-social.”

The State has said to society…I shall confiscate your power, and exercise it to suit myself.

The interests of the State and the interests of society…are directly opposed.

The State…has invariably, as Madison said, turned every contingency into a resource for depleting social power and enhancing State power.

There are two methods…whereby man’s needs and desires can be satisfied. One is the production and exchange of wealth…the economic means. The other is the uncompensated appropriation of wealth produced by others…the political means.

The State…is the organization of the political means…primarily a distributor of economic advantage, an arbiter of exploitation…an irresponsible and all‑powerful agency standing always ready to be put into use for the service of one set of economic interests as against another.

The State is not…a social institution administered in an anti‑social way. It is an anti‑social institution.

State power has an unbroken record of inability to do anything efficiently, economically, disinterestedly or honestly; yet when the slightest dissatisfaction arises over any exercise of social power, the aid of the agent least qualified to give aid is immediately called for.

Under a regime of actual individualism, actually free competition, actual laissez‑faire…a serious or continuous misuse of social power would be virtually impracticable.

The distinction between the economic (voluntary) means and the political (coercive) means offers individuals a powerful tool in understanding society. As Nock wrote, “as long as the State makes the seizure of wealth a matter of legalized privilege, so long will the squabble for that privilege go on.” Therefore, restraining State power is essential to society, because “The weaker the State is, the less power it has to commit crime.” Having moved far along a mistaken path, recognizing that insight grows ever more important.

Gary M. Galles is a professor of economics at Pepperdine University, an adjunct scholar at the Ludwig von Mises Institute, a research associate of the Independent Institute, a member of the FEE faculty network, and a member of the Board of Policy Advisors at the Heartland Institute. His books include “Apostle of Peace” (2013), “Faulty Premises, Faulty Policies” (2014) and “Lines of Liberty” (2016).